Budget suggestion: Body seeks removal of all tobacco tax exemptions

The TWGTT in its proposals has recommended that from the next budget the finance ministry should increase the tax


Our Correspondent March 26, 2016
PHOTO: FILE

ISLAMABAD:


A technical working group on tobacco taxation (TWGTT) of health ministry has sought the removal of all exemptions given to Navy officials, the president of Pakistan, the Azad Jammu and Kashmir president, provincial governors and their families and guests in tobacco taxes in the next fiscal budget.


The TWGTT in its proposals has recommended that from the next budget the finance ministry should increase the tax slab on all brands of cigarettes to Rs44 per 20-pack and Rs22 on 10-packs from the current Rs14.20 on 10-packs.

The TWGTT has also recommended allocating two per cent of tobacco tax revenue to the Prime Minister’s National Health Programme for treatment of non-communicable diseases.

In order to finalise recommendations to increase taxes on tobacco products in line with Framework Convention on Tobacco Control (FCTC) recommendations, the technical working group on tobacco taxation was formed by the health ministry. Experts from the Federal Board of Revenue, The Union (Bloomberg Partner), the World Health Organization, the World Bank and the Tobacco Control Cell were members of the working group, which deliberated upon the issue and made these recommendations to increase taxes on tobacco products in federal budget 2016-17.

Pakistan has signed the FCTC in 2004, but the country was yet to implement tax and price policy under Framework Convention on Tobacco Control (FCTC) to reduce tobacco consumption in Pakistan.

According to a research study on tobacco taxation in Pakistan, a uniform specific excise tax that accounts for Rs44 per pack of 20 cigarettes could reduce number of smokers by 13.2 per cent, increase tax revenues by Rs39.5 billion, leading to a reduction of 650,000 premature deaths caused by smoking among current smokers, while also preventing 2.55 million youth from taking up smoking.

Published in The Express Tribune, March 26th,  2016.

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